10 Things U.S. Litigators Should Know About Court .../media/email/documents/... · 3. Clarify the Role of Your French Attorney in Fact-Finding – 13 4. Do Not Count on Motion Practice

10 Things U.S. Litigators Should Know About Court Litigation in France

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This book has been prepared by and is the copyright of the law firm, Debevoise & Plimpton LLP. All rights are reserved. It may not be reproduced in whole or in part without their permission. This book provides summary information only and is not intended as legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed therein.

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© 2017 Debevoise & Plimpton LLP. All Rights Reserved.

Contents

1. Understand the Court System – 3

2. No Discovery – No Need for Litigation Hold – 9

3. Clarify the Role of Your French Attorney in Fact-Finding – 13

4. Do Not Count on Motion Practice – 17

5. No Battle of Experts: In Search of the Neutral Expert – 21

6. No Witness, No Jury, No Trial - 27

7. (Almost) No Risk of a Class Action - 31

8. Rare Big Wins and Other Economic Aspects of French

Proceedings - 35

9. Do Not Look for the Best Appellate Practitioner - 41

10. Beware of Privilege Pitfalls – 45


Introduction

Over twenty-five years of representing U.S. companies in French

civil and commercial litigation have taught us that there is much

more than a language barrier between U.S. and French litigators.

By and large, corporate lawyers on both sides of the Atlantic have

come to speak the same substantive language when it comes to deal

making. In the M&A world, save for local rules that may affect deal

structuring and execution, and save for heavily regulated industries,

transactions tend to follow similar patterns. This market practice

convergence is visible, for instance, in the fact that a standard

acquisition agreement used for a transaction in France will not look

substantively alien to a U.S. M&A lawyer, and vice-versa, and deal to-

do lists are likely to look relatively similar in both cases.

In contrast, handling cases in the U.S. and French courts are

substantively two very different things. The reasons for these many

differences are beyond the scope of this work. Procedural

differences play a significant role, but there are also cultural factors

at work, which may explain, for instance, differences in the way

clients and attorneys, and attorneys and judges, interact. Whatever

the reasons, questions posed by U.S. litigators when observing cases

in France suggest that many things are different, from how one

should handle a pre-contentious situation to how things go on

appeal, and most things in between.

As a result, U.S. lawyers facing litigation in France would be well

advised not to be guided by instincts derived from their U.S.

litigation background. For those who have deep experience litigating

cases in the United States, this may be quite a challenge.

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Putting together a litigation strategy is always a complex exercise

that involves many aspects including: the procedural rules, what is

done and what is not done in the relevant court, how the other side

is likely to approach the case, and obviously, the substantive law and

how it has been interpreted locally. When in France, the U.S.

background on such issues is unlikely to help. There is undoubtedly

some degree of universal trial lawyer common sense, which could

help understand what may or may not work in a courtroom, but

relying on this to strategize a non-U.S. case would almost certainly

be a recipe for disappointment.

Against this background, the Debevoise Paris office litigation group

thinks that it would be of help to U.S. litigators to find in one place a

summary of the discussions our group has had over the years with a

number of our clients, covering the subjects where experience shows

that U.S. litigators most frequently need guidance when considering

civil or commercial litigation in French courts. The spirit of this

paper is to provide practical, real world views, based on the authors’

experiences, rather than adding another learned treatise on the root

causes for the fundamental differences between litigation systems of

the two countries. Consistent with this approach, our paper includes

views that are judgmental in nature, which will be clearly indicated.

ANTOINE F. KIRRY ([email protected]) FREDERICK T. DAVIS ([email protected]) FANNY GAUTHIER ([email protected]) ALICE RAULT ([email protected])

mailto:[email protected]

mailto:[email protected]

mailto:([email protected]

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1. Understand the Court System

Any U.S. attorney reflecting on a court case in France may want to

begin by understanding the type of court in which the case is likely

to be heard. To a U.S. practitioner, the French court system may

appear somewhat odd, but it has its own logic.

JUDICIAL V. ADMINISTRATIVE COURTS

The first step is to distinguish between judicial and administrative

courts. In summary, administrative courts adjudicate almost all

disputes between public entities and non-public parties. This

includes, for example, taxes, public procurement contracts, zoning

regulations and building permits. Judicial courts handle all other

disputes.

This paper covers civil and commercial cases in judicial courts. It

does not cover administrative courts. Very few attorneys are experts

in handling cases in both administrative and other courts, which

have different procedures and practices. Most attorneys (including

ourselves) only handle cases before administrative courts with the

help of specialized counsel, at a minimum to provide guidance on

procedural matters. This rarely happens, however, because the

overwhelming majority of business-related disputes go before the

judicial courts.

THREE LEVELS OF JUDICIAL COURTS

There is a wide array of judicial courts, at three levels: first instance,

appeal, and a legal review called cassation.

At the first instance level, the court of general jurisdiction is called

tribunal de grande instance or TGI (there are 173 of them in France).

In addition to the TGI, there are several specialized jurisdictions,

including one for business disputes and bankruptcy (commercial


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court or tribunal de commerce), one for small claims (tribunal

d’instance), and one for employment disputes (conseil des

prud’hommes). Judicial courts also include criminal courts, which at

the first instance level consist of three different courts, depending on

the seriousness of the offenses. Crimes of intermediate seriousness,

which include most crimes associated with economic activities, go

before the tribunal correctionnel, which is a criminal chamber of the

TGI.

On appeal, cases go before courts of appeal, which can review both

the facts and the law. Courts of appeal’s decisions can be subject to

review by the supreme judicial court (cour de cassation), on issues of

law only. This supreme court either upholds the court of appeal’s

decision, or reverses it if the decision has misapplied the law, in

which case the matter is remanded to another court of appeal for

further proceedings.

THE JUDICIARY

Courts of general jurisdiction and criminal courts are staffed with

professional judges, while most specialized courts (except the

tribunal d’instance) are staffed with non-professional judges.

Unlike in most common law countries, professional judges are not

called to the bench following a distinguished career at the Bar. Most

of these judges have chosen the judiciary at the end of law school,

and go through a specialized training following a competitive exam

after graduation. At about age 27, they become judges, usually

starting as tribunal d’instance judges or junior TGI judges and then

moving up to more senior positions.

Non-professional judges may have a wide variety of backgrounds.

Commercial court judges, for instance, are elected by local business

organizations among local business persons, without a need for any


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sort of legal education or training. In practice, many commercial

court judges are elected from among in-house lawyers or have had

some legal education, but very few of them are former attorneys. All

of them are trained on the job, and take on significant

responsibilities only after a number of years in office. The

commercial court judges are not compensated. Most of them do this

in addition to their regular jobs, or upon retirement.

In both the professional and non-professional judiciary, there are

customs and traditions that tend to make the atmosphere in courts

rather formal. Attorneys usually have formal, if not distant

relationships with judges. Addressing judges with their judicial titles

is advisable, even for attorneys who happen to have personal

relationships with them. It is extremely rare for an attorney to call a

judge by telephone to discuss a case; where a conversation must take

place, this should be at the judge’s office, and the presence of counsel

to the other side is expected.

Finally, another difference with the United States is that it is not in

the French tradition to attribute jurisprudence to a judge, but rather

to a court. As a result, seeking information about the way in which a

judge has ruled on a given question is very unusual for (even alien to)

French attorneys. This is notably reflected by the French legal

research tools, as they do not have a search option which would

allow French lawyers to make researches based on the name of the

judges, but rather propose to determine how a court dealt with a

particular issue, even if the judges who rendered the decisions are no

longer holding position in such court. The absence of a “judicial

personality” of individual judges is underscored by the fact that there

is no tradition of filing dissenting opinions.


6


ATTORNEYS

All attorneys practicing within the territory over which a TGI has

jurisdiction must be members of the formal Bar set up for this TGI.

Bars are legal entities that exist by statute; they are distinct from

professional associations whose membership is optional. There are

173 TGIs in France, and roughly as many different Bars. Unlike in

the U.S., in-house lawyers are not members of any Bar, and cannot

hold themselves out as practicing attorneys (nor are their

communications deemed “privileged” because of their status).

Each Bar is headed by an elected chief, called bâtonnier. The striking

difference with the U.S. system is that French Bars exercise

disciplinary authority over their members in the first instance,

which can be appealed to a court of appeal. Bars also manage

admissions of new attorneys, resolve fee disputes between clients

and attorneys, interpret and implement the profession’s rules of

ethics, and maintain mandatory accounts to hold client funds in

escrow.

All attorneys in France are subject to common rules of ethics, with

certain local variations of modest significance. One salient feature of

these rules compared to U.S. ones is their relative vagueness and the

heavy reliance on general principles, supplemented by tradition,

precedents, local usage and consulting with former bâtonniers and

other senior attorneys. Overall, while this system gives certainty for

practices that have existed for some time and are widely recognized

as acceptable, it hardly provides safe guidelines for new questions

that may emerge, such as whether an attorney can prepare witnesses

or conduct internal investigations for a client. For this type of

question, out of caution, attorneys tend to take very conservative

views until Bar authorities have taken explicit positions.


7


Depending on the courts and the nature of the cases, the law may

make it mandatory to appear through a member of the local Bar.

This is the case for most matters before TGIs. For these cases, out-

of-town attorneys must retain a local attorney to formally represent

their clients, while they may do most of the work including

appearing before the courts. Irrespective of whether using a local

attorney is a requirement, this is almost always advisable for the

same reasons that a New York attorney would retain local counsel to

help on a case in local courts elsewhere in the United States. In

France, being an attorney from Paris may or may not be viewed as a

plus by courts and local attorneys when arguing a case in a remote

city of the country; therefore it may make sense to be chaperoned by

local counsel, usually for a very modest fee.

QUALITY NOTES

While the French court system has been under severe budgetary

constraints for a number of years (which shows in certain

courthouses needing renovation, or the antiquated state of certain

courts’ technology), by and large the system works fine and produces

decisions that are properly reasoned and predictable against legal

principles, and within a reasonable time.

Corruption in judicial circles is not known as an issue. In our

collective experience, none of us has ever been in a situation where

we suspected any improper behavior by a judge.

Other potentially problematic factors, however, should be borne in

mind.

First, certain professional judges may not always be as familiar with

economic and business realities as one would expect. To be blunt,

where handling a case involving a significant amount of money in

relation to an individual, large amounts may sometimes cause social


8


justice considerations to get in the way of the application of the rules

of law. This must be factored in the manner in which a case is

presented. Second, outside the Paris area, a dose of hometown factor

may be an issue, particularly when representing a foreign client in a

small town; this also should be factored into case strategy.

To conclude on a contextual note, French business circles are not

known to be very litigious. Most business persons believe that

reputable businesses should not be seen in court too often, and that

litigation is not a cost-efficient way of resolving disputes. They

generally favor informal negotiations with the help of lawyers of

stature playing the role of “eminent sages,” rather than crystallizing

and publicizing disputes by bringing them to courts. This said,

mediation and other organized out-of-court dispute resolutions

systems have not yet really taken off in the French legal landscape.

9


2. No Discovery – No Need for Litigation Hold

SHOULD WE DO A LITIGATION HOLD?

This is a frequent first question between a French litigator and a U.S.

client. While the answer is generally “no,” determining the best

case-specific strategy requires a basic understanding of French pre-

trial procedures, and in particular the virtual absence of “discovery”

as that exists in the United States.

The bottom line is that in most cases there will be no need to

preserve documents to make sure that they are available to produce

to an adversary in response to a demand for them. In some cases a

party may wish to “hold” documents necessary to prove its own case;

and in some instances it may ask whether a future judge would find

the absence of specific documents to be unreasonable, leading to

drawing a negative inference from their non-use in a trial. But a

reflexive “document hold” is almost never necessary or appropriate.

A FEW OBSERVATIONS

The most important point is that there is no tradition of, nor

procedure for, “discovery” in the systematic way that procedure has

developed in the United States: there is no procedure for taking an

oral deposition of a potential witness, there is no equivalent of

interrogatories and requests to admit, and there is no procedure for

obtaining documents held by an adversary that it chooses not to use,

nor from a third party. This last point may be curious because

French judges give much less weight than their U.S. counterparts to

witness testimony (particularly the testimony of a party, which is

strongly assumed to be biased), and thus give proportionally more

weight to documents. But it is nonetheless the case that a party has

no obligation under French law to establish a “hold” for documents,

because it cannot be expected that it would ever have to produce

them, except on its own initiative.


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This is particularly true with respect to documents that may be

considered unfavorable to the party that holds them: there is simply

no duty to disclose them. While this principle is nowhere to be

found in the Code of Civil Procedure, it is usually regarded as self-

evident, and the fact that it is ordinarily referred to in Latin (nemo

contra se edere tenetur) contributes to the general belief that this is a

fundamental principle of the law of evidence in France.

Professionally, French attorneys are under no different obligation; a

French attorney might get into trouble for violating the nemo contra

se edere tenetur principle, but never for failing to disclose or produce

a document that is unfavorable to his client’s interest.

There may be two occasional exceptions to this general rule.

First, Article 142 of the Code of Civil Procedure provides that a court

can order a party to disclose documents on an application made by

the other party; however, in reality, the courts have interpreted this

provision in a manner that makes it helpful in only relatively rare

scenarios. Courts have said, for instance, that the application must

identify the specific documents to be produced, and the existence of

these documents must be certain. American-style requests for “all

documents” bearing on a subject will be rejected. Courts will also

dismiss an application where the nature, the origin and the exact

number of the documents to be produced are unknown. They also

tend to require that the applicant prove that the documents will

certainly be helpful to the case.

In sum, where a party alleges a critical fact and can make a case that

the only way of proving this fact is by ordering the other party to

produce a document whose existence is certain, Article 142 may help.

This assumes, of course, that the parties are already at a stage where

they are exchanging arguments on facts and law for final


11


submission. This has nothing to do with a pre-trial phase where

both parties are gathering factual information, on the basis of which

they will subsequently build their arguments and strategies.

Second, under certain circumstances where it is clear that a

document would normally be found in the possession of one party,

the failure of that party to use that document in the litigation may

be the basis for an inference that it would have been harmful to that

party’s case. Such a situation may arise, for example, if a document

in the possession of one party refers to a document in the possession

of its adversary.

As a result, the question of what documents to produce (and by

extension, whether to do any document “hold”) depends more on

strategy than on either professional ethics or legal obligations. The

fundamental questions are: what is my case, what facts do I need to

establish my case, what documents help me prove those facts, and

am I at a risk of inviting an adverse inference if I use those but

withhold others? The development of that strategy – which may be

crucial – will of course be different in each case.

Finally, a party (or even a non-party) that has documents located in

the United States may face an attempt in U.S. courts to obtain those

documents “for use in” a French proceeding, under the terms of 28

U.S.C. Section 1782, and the testimony of witnesses located in the

United States may also be sought under this provision. If this

happens, there may be a reason to put in place a litigation hold so

that the party holding documents in the United States would not put

itself at risk of breaching U.S. discovery rules. At least from a French

perspective, however, (i) there would be no basis to put a hold in

place before the holder of the document becomes aware that

someone is filing a Section 1782 application to which the documents


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it holds may be relevant and (ii) there would be no basis for

extending this hold to documents located in France.

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3. Clarify the Role of Your French Attorney in Fact-Finding

The key role for any attorney is of course to work with the client to

develop the winning strategy for a given litigation, and crucial to

that effort will be exploring and developing the relevant facts. In the

United States, attorneys are deeply involved in that process – and in

most instances run it. In France, attorneys face some professional

restraints that derive more from tradition rather than specific rules;

while they should not inhibit the strategic development of a case, it

is useful for a U.S. client to be aware of them.

The first situation arises when a client asks the attorney to visit the

client’s offices and go through documents, files, archives, hard drives

or any other form of materials to identify and gather materials

necessary to build the client’s case. There is no rule prohibiting this,

but many attorneys feel uncomfortable doing so simply because it is

not quite in the traditional scope of an attorney’s work (not so long

ago, French attorneys were not allowed to visit clients’ premises and

give legal advice outside of their offices). In fairness, this reticence

seems to be fading away, particularly for attorneys who represent

large international companies; however, in retaining counsel for

cases that may involve significant fact development work, U.S.

clients would be well advised to discuss this subject in advance to

avoid surprises.

A different situation may arise if a client expects a French attorney

to meet with potential witnesses, evaluate them and help them

establish their written testimony (see No Witness, No Jury, No Trial,

below). Many attorneys are likely to feel uncomfortable with the

client’s request on the generally-held belief that it is forbidden for an

attorney to contact and talk to a potential fact witness who could

help the client’s case, or to take any part in the drafting of written


14


testimony. There is no Bar guideline specifically authorizing

attorneys to meet with witnesses to prepare a case (although in the

somewhat comparable situation of doing “internal investigations” in

criminal matters, the Paris Bar has in the last year issued an opinion

and guidelines permitting attorneys to participate in such

investigations; and development of witness declarations in

international arbitrations is expressly permitted).

In the absence of an affirmative rule, many attorneys feel that they

would be at risk of being accused of attempting to influence a

potential witness’s testimony if it were known that they met with a

witness on behalf of a client with an interest in that witness’s

testimony – and of course, any actual attempt to influence testimony

could lead to criminal charges of witness tampering. But there is no

rule that expressly forbids such a contact, and the reticence to do so

probably results mostly from a sense that “this is not typically done,”

combined with a concern about what courts or other lawyers may

think if they knew about contacts with witnesses.

In most instances, a savvy attorney will be able to meet with a

witness and evaluate that witness’s testimony without risk of being

charged with inappropriate conduct. In potentially difficult

situations it may be advisable to urge potential witnesses to

participate in meetings with their own counsel. Potential witnesses

may not like the idea of incurring counsel costs for the benefit of

someone else; however, the client seeking the witness deposition

may offer to bear the cost.

Whatever the process is, clients would be well advised only to use

written testimony whose wording has been well thought through,

and which lead counsel actually finds helpful to the case. “Less is

more” may be a useful axiom. The practical rule that some of the

best factual arguments can often be found in the other side’s exhibits


15


often works in France, therefore there is no need to help the other

side by providing testimony whose vagueness, excessiveness, or

other flaws may backfire.

A next-to-final note: U.S. clients should bear in mind that the market

for investigation services is very limited in France and that a number

of investigation services firms have mixed reputation, which tends to

color the work product of virtually all firms when it is used in court.

U.S. clients should consult with their French counsel to determine

exactly how an investigator may help, and be careful in choosing

them.

Final note: as in many other countries, the reality of court work is

that the fate of most cases rests on the quality of the facts that one

can present to the court. Many judges tell us that by the end of the

fact section of the parties’ briefs, they expect to have a sense of

where their decisions are going to end up. In light of the importance

of the fact-development phase of virtually any court case, and the

potential issues outlined here, we recommend that U.S. clients

discuss early on with their French attorneys what they expect them

to do in this area, and resolve any issue in this regard while there is

time to do so.

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4. Do Not Count on Motion Practice

Can’t you just file a motion to dismiss? How about a motion for

summary judgment? Let’s move to have this question of law

resolved first. Let’s get the court to issue an interim decision on

jurisdiction.

Well, not so easy. The short of it is that French procedural rules do

not contemplate motion practice, in the U.S. sense of this expression.

There are only limited substitutes.

IMPOSSIBLE TO CUT THE PROCEEDINGS SHORT

Civil and commercial proceedings start when the claimant files the

complaint (following service on the defendant) with the clerk of the

court. The clerk then allocates the case to one of the chambers of

the court based on a summary review of the subject matter, and puts

the case on the chamber’s docket. Except in very simple cases, this

opens the “pre-trial phase” of the proceedings, during which the

parties are expected to submit briefs to the court and exchange the

exhibits on which they intend to rely. In both civil and commercial

cases, the pre-trial phase consists of a series of procedural

conferences presided by one judge of the court (called “juge de la mise

en état” or “pre-trial judge”), in which the judge essentially checks

that the briefing of the case is progressing in a satisfactory manner.

The key point for U.S. litigators is that in this “pre-trial phase,” it is

virtually impossible to “put an end” to a case. In other words, absent

a withdrawal or a settlement, almost all cases go up to the final oral

argument on the merits. Under the Code of Civil Procedure, there is

no such thing as a motion for summary judgment or motion for

judgment on the pleadings. In a defense strategy, no one should

expect to be able to cut the proceedings short, no matter how

factually unsupported or legally frivolous a claim may be.


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There are only a few situations in which a defendant may have a case

dismissed prior to the conclusion of the normal case process. This

works only for cases before the TGI. In this court, the pre-trial judge

has authority to rule on certain issues that may cause the case to fail,

such as the claimant’s lack of standing, the action being time-barred,

a res judicata objection, a challenge to the court’s jurisdiction, or a lis

pendens situation. In contrast to the U.S. rules, however, none of

these issues comes anywhere close to an early adjudication on the

merits.

A FEW PRE-TRIAL PHASE PITFALLS

While the pre-trial phase is not intended to touch on the merits of a

case, a couple of issues may arise in that phase that may ultimately

have consequences for the merits.

First, a party may apply for the appointment of a neutral expert or

another type of court-ordered fact finding measure. In reality, this

may sometimes be used by a defendant as part of a delaying tactics,

because it is usually difficult to object to a measure of this nature

(and an immediate appeal is virtually impossible), and once ordered,

the case is usually put on hold for many months until the court-

ordered measure has been implemented.

Second, where a defendant has raised a procedural objection as part

of its defenses, and the case comes to the final hearing, it is usually a

good idea for the claimant to request that the court rule on this

objection together with the merits of the case, as opposed to issuing

a separate decision on the jurisdictional issue. A separate decision

would open the door to the defendant for a reconsideration of the

jurisdictional issue by the court of appeal, and subsequently by the

cour de cassation, during which the proceedings on the merits may be

on hold for a couple of years. Most judges are now familiar with this

type of procedural maneuvering, and rarely fall into the trap of


19


ruling on jurisdictional objection alone, except where there is a

strong reason to do so.

Third, U.S. litigators should bear in mind that there are very few

“hard” deadlines in the pre-trial phase. It is very usual (and not badly

perceived by French courts) for parties to requests additional time to

prepare and file their submissions. In fact, the risk that a submission

be put aside because it was filed too late is virtually nil before

commercial court, and it is very limited in practice before civil

courts, since judges usually warn parties when their “last chance” to

file a submission has come. On a regular basis, judges repeat to

attorneys that they (and their clients) should do their best to comply

with court’s deadlines, and that they will be more severe in the

future, but as of now, we have not seen major changes in that regard.

Finally, parties should not count on extensive conversations with the

court at the procedural conferences that punctuate the pre-trial

phase. Except if some of the procedural questions addressed above

are raised, parties have very few communications with the judge

during the pre-trial phase. During the procedural conferences, and

especially commercial conferences, the speaking time of the

attorneys is very limited – less than a minute generally. Also, there

is no certainty as to whether the same judge will hold the next

procedural conference, and, except in very rare cases, the judge who

set up the deadlines for the submissions may have only done a quick

review of the papers filed by the parties.

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5. No Battle of Experts: In Search of the Neutral Expert

One situation that is often the source of important strategic

discussion is where one or several parties intend to rely on scientific,

technical or other specialized knowledge as part of the facts they

need to prove to make their cases. This situation exists typically in

actions based on commercial sales, where purchasers allege that the

products sold had hidden defects at the time of the sales. This

situation also arises in many other contexts, for example in tort

actions arising from industrial accidents, where the claimants need

to prove that the facts relevant to the source of the accidents were

under the defendants’ control.

In most cases, the parties that need to make scientific or technical

allegations, or other allegations based on specialized knowledge,

initially rely on their own resources, or call on experts of their own

choosing, to provide views on the solidity of their cases and help

come to a conclusion on whether the cases are worth pursuing. In a

number of legal systems, the views provided by these experts would

be enough to build the record of the cases on the facts they cover, it

being up to the courts to weight the various experts’ opinions and

decide on the necessary technical facts on that basis.

In French litigation, a court will almost never consider a scientific,

technical or other specialized question based only on the parties’

submissions and without an opinion from a neutral expert whom the

court has appointed specifically to provide views on the issue. This

process – known in France as an “expertise” – often becomes the

most time-consuming, expensive, and important part of the case.

There are essentially two situations in which a court will appoint a

neutral expert. First, prior to bringing a claim on the merits, a

5. No Battle of Experts

22


potential claimant may apply to a court to seek the appointment of a

neutral expert to look into a given fact situation and provide an

opinion on certain factual issues that may be critical to the question

whether a claim on the merits should be brought at a later stage.

This pre-claim appointment is relatively easy to obtain (the standard

is limited to a showing that there is an interest in considering the

factual issues now rather than later, for instance because there is a

risk that the facts be altered by the passage of time). Second, in the

context of preexisting proceedings, the court may issue an interim

decision to appoint an expert, either sua sponte or at the request of

one or more parties. In both cases, experts’ services are usually

moderately expensive (but the resources the parties need to invest to

participate in the expertise process often make this process an

expensive phase of a case).

Whenever an expert is appointed in either one of these scenarios, the

following observations are worth bearing in mind in considering the

appropriate strategy.

THE UNPREDICTABLE EXPERT

The short of it is that the expertise process is only as good as the

expert who runs it; yet the quality of the expert is to a great extent

unpredictable. In designating an expert, courts almost always draw

from a pool of sworn experts whose names appear on lists

maintained by courts of appeals. To be registered as expert in any

particular field, a candidate must only prove that he holds

educational degrees relevant to the field of expertise for which he is

applying, and produce copies of his works (if any) in this field.

While this system is intended to provide assurances that experts are

always knowledgeable in the fields for which the courts appoint

them, reality sometimes falls short of this objective. Because being a

court expert is both time consuming and modestly compensated,


23


numerous experts are aging or retired engineers, industry employees

or other professionals who do this as an ancillary activity or as the

final stage of their careers. Sometimes experts are too busy with

their principal activities to focus on their expert’s work, or they are

somewhat less sharp than they have been at the height of their

careers. In addition, some of them may have worked in a narrow

specialty and nevertheless be listed as experts in a field that is much

broader (e.g., a retired chemist in the rubber industry would be listed

as an expert in chemistry generally, and thus could be appointed in a

case involving chemistry issues that he has not seen in years).

Add to this the fact that parties tend to have little leverage on which

expert a court will appoint in any given case. Where there is a

discussion with the court on this issue, it is usually brief and revolves

mostly on whether any particular potential appointee is available and

has a track record of turning in opinions within the time periods

prescribed by the courts. Suggesting that a potential appointee does

not possess the necessary knowledge for an appointment within the

field for which he is registered as expert must be done with great

care (for instance, gently reminding the court of a mixed experience

with a proposed expert is fine), or else the court could view this as

offensive and counterproductive.

DEALING WITH THE EXPERT IS A “CASE WITHIN THE CASE”

Once the expert is appointed, court proceedings are usually on hold

until the expert turns in an opinion. During that time, the action in

the case is before the expert, and this action must be carefully

managed.

In brief, the expertise process usually consists of a series of meetings

with the expert (always with the participation of all parties

involved), and a series of written submissions (called “dires”),


24


including communicating to the expert the background materials

necessary to reflect on the relevant factual issues.

One key aspect of this process is that it is highly advisable to build

goodwill with the expert. Even the most rigorous scientist may be

sensitive to the atmosphere in which the expertise process unfolds;

therefore there is value in being cooperative, respectful and friendly

with the expert. Confrontational strategies are generally risky

because the expert does not have much to lose -- and ultimately is

the one providing a potentially important opinion. The short of it is:

there is not much one can do to complain about an unsatisfactory

court-appointed expert. In each court, a judge is appointed to

supervise expert proceedings; however, parties who intend to

complain about an expert should think twice and be certain that they

will give the judge valid reasons to take action (which may include

appointing another expert in addition to or as replacement for the

first expert), failing which complaining may backfire when the

incumbent expert writes his final opinion.

U.S. clients are often inclined to bring in their own experts, whose

technical abilities enable them to follow the court-appointed expert’s

work and call attention to certain specific points. While there is

nothing wrong with this, parties’ experts should be briefed about the

potential sensitivity of their interacting with the court-appointed

expert. Particularly if a party’s expert has credentials that are more

powerful than the court-appointed expert’s, he would be well advised

to show sufficient deference to the latter to avoid relational

difficulties that would make the participation of the party’s expert

eventually counterproductive.

Where a party believes that the expert process may not be going its

way, and the expert has not responded favorably to observations

made in writing or at meetings, it is time to anticipate a potential


25


challenge to the expert’s opinion once the case returns before the

court. This should be planned ahead of time, before the expert turns

in the opinion. One of the most helpful methods is to pose

strategically careful and pointed technical questions, to which the

expert must respond in his final opinion. When properly executed,

this method forces the expert to unpack his reasoning, which may

highlight shortcuts or other insufficiencies that may be

subsequently leveraged to question the soundness of the expert’s

opinion.

DEALING WITH THE EXPERT’S OPINION ONCE BEFORE THE COURT

With the submission of the expert’s opinion to the court, either the

clerk transfers the case back to the active docket (if the expert was

appointed in the course of an action on the merits) or it is up to the

parties to decide whether they intend to commence proceedings on

the merits (if the expert was appointed prior to any proceedings on

the merits). Where there are proceedings on the merits following

the submission of the expert’s opinion, the principal question is how

much weight this opinion has in the eyes of the court.

The book answer to this question is relatively simple: experts’

opinions are for the courts’ information only, and courts are never

bound by them.

Reality is somewhat less clear. By and large, in off-the-record

conversations, most judges make no mystery of the fact that they

tend to take experts’ opinions with one or more grains of salt, and

they expect to be convinced by experts’ analyses rather than be

served with dogmatic opinions inviting leaps of faith. But in reality,

it looks like the smaller the cases, the more likely it is that judges

will tend to adhere easily to experts’ opinions, save where opinions

are clearly wrong or unjustified.


26


In larger cases, it is not uncommon for judges to ignore or even

expressly set aside expert reports that they find unconvincing; this

may happen, for instance, where the expert’s opinion is not

sufficiently firm (e.g., the expert has expressed a probability, or the

expert has adopted one possible explanation without formally

excluding other possible explanations); or sufficiently justified (e.g.,

the expert has expressed his opinion without describing the reasons

for this opinion). Parties should exercise sound judgment, however,

before criticizing an expert’s report before a court, and they should

only do so if there are solid arguments, failing which the court would

be likely to receive criticisms of the expert’s opinion as an attempt by

a disgruntled party to have the court redo the expert’s work, for

which courts have little appetite.

The importance of the expertise phase in a French court case cannot

be overstated. For U.S. litigators, this is a tricky phase, because not

only is this process alien to the manner in which they are used to

establishing facts based on scientific, technical or other specialized

knowledge, but also the core of the action in the expertise process

tends to follow unwritten rules or customs that may appear

counterintuitive. Yet this phase may be determinative of how the

case will ultimately be shaped before the court. This is the reason for

which we routinely urge clients to commit sufficient internal and

external resources to participating in expert processes; in most cases,

this is time and money well spent.

One final note: legal issues never fall in the scope of a court-

appointed expert’s mission. Thus, at the end of the expertise process,

all the legal questions of a case are still open, in addition to factual

issues not covered in the expert’s opinion or arising from the expert’s

opinion. In that sense, it would be a misconception to believe that

cases are effectively over when court-appointed experts turn in their

opinions to the courts.

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6. No Witness, No Jury, No Trial

Our U.S. counterparts find it visibly unsettling to hear from us that

in the end game of a case, there will be no witness, no jury, no trial.

Yet our system works fine without them, albeit very differently from

the U.S. one.

NO WITNESS

In civil and commercial cases, courts almost never hear live

testimony of witnesses. When they do, this is generally in the

context of civil (mostly domestic relations) cases, and there is no

such thing as direct, cross and redirect: the judge asks all questions

on points of interest to resolve the case. Counsel can only suggest

questions to the judge, who may or may not pose them depending

on how helpful he thinks they are. Questions going directly to a

witness’s credibility rarely pass that bar, for instance.

Yet our Code of Civil Procedure includes a series of provisions

relating to the taking of witness testimony before the court. So why

is it that most practitioners concur that these provisions are largely

unused and obsolete? We believe there are two reasons for this.

First, our experience suggests that courts are reluctant to take live

testimony of witnesses simply because this takes too much time. As

in many other countries, French judges tend to be overloaded with

cases, and under some pressure from their organization to improve

efficiency in resolving them, which is hardly compatible with taking

live depositions of witnesses.

Second, the French judicial system does not put as much weight on

testimonial evidence as other systems do. To put it bluntly, judges

generally prefer to rely on contemporaneous written materials than

on the memories of witnesses, and this preference is at least partially


28


attributable to the underlying notion that witnesses make inaccurate

statements from time to time, whether intentionally or simply

because their recollection is faulty.

Against this background, practice has developed the use of written

testimony as the preferred method of bringing testimonial evidence.

These declarations are produced in the course of the proceedings,

just like other supporting documents. When a case is ripe for the

final oral argument, there is usually not much of a reason to take live

testimony of those who have provided written declarations.

NO JURY

The discovery of “no jury” often comes as a relief to our U.S.

colleagues, who seem happy that French cases do not involve the

complexity and unpredictability of having factual issues decided by a

group of citizens. The short of it is: a jury in civil and commercial

cases is wholly alien to French procedure. The only judicial

proceedings where juries are used are those for the most serious

crimes, before a special court called a cour d’assises.

This does not mean that experience of dealing with juries cannot be

of help when planning for a case in French courts. Techniques for

making complex facts sound simple, finding the right examples and

comparisons, and gently steering an audience one’s way are equally

helpful in French courts. This is notably so in commercial courts,

where most judges are business persons with little if any legal

education, whose views of cases may be predominantly based on

their understanding of the facts and a desire to be equitable and

reach resolutions that make good business sense.

NO TRIAL

Part of what makes French court litigation a relatively inexpensive

process compared to its U.S. counterpart is the absence of protracted


29


trials, which may require the presence of armies of attorneys and

support staff in court for days if not weeks.

What serves as trial in France is a hearing by the court on the basis of

the record already submitted to it, and what attorneys do at this

hearing resembles the closing argument in a U.S. trial. The rules of

evidence are simple, and rarely give rise to a discussion of

“admissibility;” essentially, the record is what it is. Judges expect

attorneys to give them a summary presentation of the key facts and

the salient point of law, with references to a few directly relevant

documents. They generally like brevity, and a sense that attorneys

have really developed their case to highlight the principal issues to

be resolved. They confess in private conversations that they have no

patience for attorneys who cannot see the forest for the trees, or

who indulge in posturing, rehashing or delivering lectures on basic

legal principles.

While in most courts the oral argument takes place before a panel of

three judges, there is a growing tendency of courts to use

opportunities under the rules to impose, or urge parties to accept

being heard by, a sole judge. Another growing tendency is to drop

the traditional formal oral argument by attorneys and favor Q&A

sessions where courts can pose questions that they believe are

relevant to the cases, rather than relying on the judgment of

attorneys to make that selection. Both aspects of this evolution are

very visible in commercial courts, where oral arguments now

routinely consist of Q&A-type conversations that rarely exceed 30

minutes and are frequently held in judges’ offices.

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7. (Almost) No Risk of a Class Action

Most of our U.S. clients would agree that one of the good things

about the French procedural system is the abence of class actions.

This is not quite the case, but not far from reality.

Traditionally, there are no collective actions or damages under

French law. French courts have consistently refused to let groups

seek compensation for damages suffered by categories of individuals

from similar facts, except where there were statutory exceptions

(and there were only few). It was not until 2014 that, under heavy

pressure from consumers’ organizations, the French legislature

adopted rules that permit some degree of class actions, called “action

de groupe” or “group action”.

This is not, however, a dream come true for a would-be (and mostly

non-existent) French plaintiff bar. The new legislation seems

unlikely to foster some of the distasteful client chasing practices that

may exist in the United States around class actions, for two reasons.

First, victims alone cannot bring these new actions: they must act

through an approved consumers’ association (there are about 15 of

them), which presumably should be less sensitive to heavy attorney

courting than victims left on their own; and second, “no win no fee”

arrangements being prohibited under the rules governing the legal

profession, one of the most seductive argument of the plaintiff bar

remains unavailable. In addition, because punitive damages are

unavailable in French courts -- and compensatory damages tend to

be much lower than in the United States -- the promise of making

victims rich will not work either.

In theory, the core conditions for this French version of the class

action resemble those required in the United States: the action is

available where (i) several people who are in an identical or similar


32


situation each suffer an individual injury; (ii) these injuries have a

common cause; and (iii) one person is deemed to be responsible.

Beyond these basic conditions, many things differ from the U.S.

model: (i) these new actions are always based on an “opt-in” system,

and (ii) the plaintiff is not the “class” as such, but the specific

approved association that represents the interests of the group of

identified individuals who are opting-in to have the association bring

an action on their behalf, which makes it impossible to constitute a

class of unidentified individuals.

There are other hurdles and limitations. The most critical one, in

our view, is that a group action can only relate to (i) pecuniary loss

suffered by consumers, taken as such, or (ii) since 2016, bodily

injuries or pecuniary loss in specific areas (environment protection,

health matters, discrimination in the workplace and data

protection). For instance, such an action would be available to bank

clients claiming for unjustified bank fees, or consumers claiming

because a product does not conform to information on the product

label, or abusive pricing by a mobile telephone operator.

Once constituted, group actions follow specific procedures. In cases

where the plaintiff association is seeking compensation (as opposed

to an order to discontinue a certain action or omission), the courts

will rule on liability, define the group of victims (the equivalent of

the U.S. class) and set up the amount of damages or the calculation

methods to be used. This court decision is then published to give

non-participating individuals a chance to opt-in and apply for the

payment of damages to which they are entitled (the courts should

set a two- to six-month window to submit an application).

While it is too early to form a view on whether this new type of

action is going to be successful in France, early indications suggest


33


that it may well remain rather marginal given the hurdles and

limitations outlined above. Also, the view has been taken that group

action proceedings may be quite lengthy. Since 2014, only nine

consumers group actions have been commenced by associations, and

only one has given rise to a settlement of €2 million in the aggregate

(to be distributed among 100,000 individuals). Many voices in the

legal profession have said that, with the current rules, it seems

unlikely that group actions are going to develop significantly. We

concur.

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8. Rare Big Wins and Other Economic Aspects of French Proceedings

When litigating in France, one should not expect to find comparable

damages nor equivalent trial costs as in the United States. For a

plaintiff, French litigation tends to be less costly but less profitable

than U.S. proceedings; respondent companies will likely face a

smaller litigation risk.

RARE BIG WINS

The world-famous generosity of U.S. juries in personal injury cases,

which makes the jurisdiction of U.S. courts so desirable to plaintiffs

around the world, finds little echo in France. Not only would awards

in personal injury cases usually seem miserable by U.S standards, but

generally speaking, damage awards are much more modest than in

U.S. courts in all areas. Here are the key underlying factors.

First, punitive damages are alien to French civil proceedings. It is a

firmly established principle that damages should not make the

plaintiff richer than if the facts that caused damages had not

occurred, and a plaintiff perceived as greedy would find little

sympathy on the bench. Damages are therefore limited to what is

necessary to put the plaintiff back in the situation in which he would

have been absent the facts that caused damages. As a result, for

example, there is no such thing as double, triple or cumulative

damages for the same injury.

Second, French courts tend to take a relatively restrictive view of

causation. The causal event has to be essential to the occurrence of

the damage, meaning that without such causal event, the damage

could not have occurred. Simultaneity or simple temporal

relationships are not enough. Further, compensation for loss of a

business opportunity, although long accepted in French case law in


36


principle, will be harder to obtain and lower than in the United

States. Plaintiffs bear the burden of proving that they have lost an

existing opportunity and that there is a causal nexus between this

loss and the faulty behavior or negligence of the person claimed to

be liable. French courts will then compensate the lost opportunity,

but not the profits that the plaintiff would have received if the

favorable event had happened. Damages will thus only represent a

fraction of the benefits that were hoped for.

Third, there is no real workaround through contractual clauses. In a

contractual context, a party may impose a severe penalty clause in

case the other party breaches the agreement; however, the day there

is a breach and a party attempts to enforce the penalty, the party in

breach has the right to apply to a court and ask that the agreed-upon

penalty be reduced. In considering this application, a court typically

looks into whether the amount of the penalty is excessive compared

to the damage actually suffered by the party that seeks to enforce the

penalty. If the court finds that the penalty is excessive, it usually

reduces it to an amount that is closer to the actual damage suffered.

NO “LOSER PAYS” RULE

Proceedings in French courts almost never involve the parties

submitting copies of their respective attorneys’ bills in support of an

award of fees to be included in the final court’s decision, or in fact

any decision. The short of it is that the winner in a case is never

entitled to recoup its attorneys’ fees, or any defense cost, from the

losing party.

This does not mean that the winning party is never entitled to some

payment against its attorneys’ fees. Rules of civil procedure require a

court to order the losing party to pay the other party an amount in

consideration of defense costs; however, this amount is in the court’s


37


discretion, and the rules require that the court take into account

equity and resources of the losing party. The rules even say that the

court may decide that there is no reason to award anything to the

winning party.

With this guidance in the procedural rules, it is hardly surprising

that awards in excess of a few thousand euros are rare, even in

complex cases. In one of them, involving an application to set aside

a multi-hundred million dollars arbitration awards between two

industrial giants, the Paris court of appeals awarded to one of our

client 100,000 euros as defense costs, which has been standing for a

number of years as one of the largest amounts ever awarded on this

basis.

MINIMAL COURT COSTS

On the theory that justice must be a public service available to all

regardless of resources, the court system is primarily funded by the

government’s budget, which makes litigating in French courts

remarkably inexpensive to the parties.

In a typical civil or commercial case, where costs do not include

outside service providers’ costs, court costs rarely exceed a few

hundred euros, even in very large cases (there is no longer any cost

item set in proportion to the amounts in dispute).

Costs may be greater only if the court has called on an outside

service provider during the course of the proceedings, a neutral

expert (see above) or a translator, for instance. In this case, while the

service provider’s fees are usually advanced by one of the parties, the

ultimate decision will include a determination of court costs

including the amount of these fees and who should ultimately bear

them, which may make the overall cost amount quite significant.


38


When rendering a decision, French courts have to rule on costs. In

the great majority of cases, courts will order the losing party to pay

these costs. Courts will only decide otherwise in specific cases, such

as when the claimant committed a fault, or for equity reasons.

MODEST PRE/POST-JUDGMENT INTEREST

Pre-judgment interest is not awarded automatically: interest can

only be awarded when the plaintiff has sent a formal notice to the

other party. For contractual matters, interest only starts running

when the plaintiff has formally demanded performance of the

obligation, with some exceptions. In tort actions, there is no pre-

judgment interest as such; rather, the plaintiff must count interest in

the damage application.

Post-judgment interest is awarded by courts even if the plaintiff has

not requested it. Interest starts running from the date of the

decision, unless the court decides otherwise.

For both pre- and post-judgment interest, the rate to be used is set by

a governmental order, twice a year, based on short term market

rates. For 2017, the first semester rate is 0.9% per annum where the

subject matter of the action falls within the scope of the plaintiff’s

professional activity, or 4.16% where it does not.

ATTORNEYS’ FEES

Over time, the legal profession has moved from its traditional fixed-

fee approach to an hourly rate system with, by and large, the same

types of alternative arrangements as exist in many other countries.

Some traditional local firms still favor the fixed-fee system, with

anecdotal indication that this may not always make them any

cheaper than hourly rate firms.


39


The salient feature of the attorneys’ fees system is the relative

repugnance for contingent fee arrangements. Under applicable rules,

full contingency arrangements are prohibited. Partial contingency

arrangements (where an attorney’s compensation is comprised of

contingent and non-contingent portions) are permissible; however,

the rules are silent on which proportion may be contingent. In

doubt, most attorneys prefer to stay away from potential difficulties,

therefore contingency arrangements are seldom used, and only for

small portions of attorneys’ compensation.

Overall, most U.S. general counsel would find litigation in France

inexpensive compared to the cost of defending a similar case in the

United States. In our view, this is largely due to the absence of the

significant costs associated with discovery, and the simpler

procedural rules, which do not lend themselves easily to procedural

warfare. Hourly rates tend to vary very significantly from one firm

to the other (and even more so between a Paris firm and a firm based

elsewhere in France); but rates at leading firms are not too far apart

from those in cities like London or New York.

THIRD PARTY FUNDING?

As regards France, at this point third party funding of dispute

resolution processes has only developed to a meaningful extent in

the arbitration area. This statement may change in the near future.

There has been considerable thinking around this subject for court

litigation, and the trend is clearly in favor of developing this practice,

based on a set of rules that would eliminate legal and ethical issues

that have been raised.

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9. Do Not Look for the Best Appellate Practitioner

Somewhat provocatively, we often tell our U.S. clients that there is

no such thing as an appellate practice in France. Not in the U.S.

sense, at least.

Here is why.

First, appeal is generally as of right for most decisions rendered by

the courts of first instance. There are limitations, however. Certain

preliminary or interim decisions cannot be appealed independently

from the decision on the merits that will follow. As a rule, however

a first instance decision that adjudicates at least a portion of the

substantive issues before the court can be appealed, and there is no

need to secure permission from the court of appeals to do so. This,

added to the fact that appeal proceedings usually represent only a

relatively modest incremental legal cost compared to the first

instance proceedings, explains why litigants usually do not hesitate

bringing cases to the court of appeals. As a result, most courts of

appeals in France tend to be overburdened, which in turn tends to

make cases last longer than they should, about two years on average

in most French courts of appeals. This may be one of the few real

reasons why parties may hesitate about bringing a case to appeal, as

the prospect of keeping a case alive for this much time is often a

persuasive prompt to opening or resuming settlement discussions.

Second, an appeal is essentially a replay of the first instance

proceedings (a new trial, as our U.S. colleagues would say), in that

the court of appeals will consider both the factual and legal aspects

of the case. While there is a possibility to bring new facts and (to a

limited extent) new claims on appeal, in most cases, the facts and

legal arguments raised in the first instance are re-presented in the


42


same manner on appeal, the principal additional point being an

explanation of why, in the appellant’s view, the first instance court

erred in rendering its decision.

Third, as a result, arguing a case on appeal is essentially no different

from arguing it in the first instance; consequently, there would be no

real justification for a subsection of the Bar that would specialize in

practicing before the courts of appeals. Ergo, no appellate practice as

such; this is why it hardly makes any sense for a U.S. client to look

for the “best appellate attorney” to take its case to a court of appeal.

One historical note is in order to avoid confusion in this area. Until

2012, France had a special legal profession (called avoués), with a

statutory monopoly to act as procedural agents of parties before

courts of appeals; however, this profession had nothing to do with

appellate practitioners in the U.S. sense of this expression. The role

of avoués was predominantly to be the agents of the parties before

the courts of appeal and handle procedural questions on their behalf.

They had the right to take over cases entirely from first instance

attorneys, and brief and argue cases on appeal, but in practice, very

few of them did so. Therefore, even in those days, first instance

attorneys would typically brief and argue cases on appeal, using

avoués just as procedural agents. This profession was eliminated in

2012 and the right to act as procedural agents before the courts of

appeal was conferred on all attorneys; however, most former avoués

have reestablished themselves as regular attorneys and now offer

services consisting of handling procedural questions in appellate

proceedings. This has met with some success; indeed, most

attorneys handling a case on appeal feel more comfortable farming

out procedural issues to a former avoué. There are two principal

reasons for this: a) most attorneys have limited experience of

appellate procedures, which can be quite time consuming, and b)

former avoués typically charge very modest fees for this. The key


43


point here is that a former avoué is in no way an appellate expert in

the U.S. sense of this expression.

While first instance attorneys generally handle cases that go to

appeal, clients are free to change counsel for the appellate

proceedings, for any reason. If they elect to do so, however, they

should bear in mind that there is not a pool of appellate experts to

choose from.

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10. Beware of Privilege Pitfalls

Privilege is another key issue where there can easily be

misunderstandings between U.S. and French litigators, because the

respective rules are markedly different.

Privilege, in the sense of a right not to disclose something in

response to a request from a third party, has a very narrow scope in

France, simply because practically speaking, there is no discovery in

civil litigation; ergo no reason to develop a body of rules to delineate

what should be exempt from discovery. In this sense, privilege is

mostly relevant in the context of criminal and certain administrative

investigations, as will be seen below.

What really is relevant in the French system is a set of obligations on

attorneys regarding the confidentiality of information coming from

their client or other attorneys.

There are two guiding principles that govern this matter: first, an

attorney must keep confidential any non-public information coming

from his client, even if the client expressly waives the attorney’s

obligation to do so; and second, any communication from a French

attorney to another French attorney is per se privileged, in the sense

that an attorney would commit an ethical violation if he produced

such communication in court or if he forwarded it to his client or a

third party.

The impossibility for the client to waive his attorney’s

confidentiality obligation is a frequent eyebrow-raiser to U.S.

litigators. Yet this rule is enforced rather inflexibly, with both

criminal and professional penalties attached to it. It usually does not

generate much trouble, though, because workarounds are relatively

easy. For instance, where a client requests his attorney to provide


46


the client’s auditors with certain information regarding pending or

threatened actions, the Paris Bar has simply recommended that

attorneys direct their responses to the clients, with a note that the

clients are free to forward the responses to the auditors if they so

wish. In general, while the client cannot waive the attorney’s

confidentiality obligation, there is nothing to prevent the client

himself from releasing information the attorney could not release.

This workaround tends to resolve most issues in this area.

For the confidentiality of attorney-to-attorney communications, the

most striking example of where these rules may play out in a

manner that is disconcerting to U.S. litigators is settlement talks.

Coming from a U.S. background, one could think that there is no

harm in communicating with an adverse party in an effort amicably

to resolve a dispute, including exchanging views about settlement

positions and offering concessions. The nature of these exchanges

might make them inadmissible evidence in a U.S. case, but not so in

France. There is no per se protection of settlement oriented

communications where they are not covered by the attorney-to-

attorney communication privilege.

More than one U.S. party has fallen in the trap of commencing good

faith discussion towards resolving a dispute with a French party,

expressing candid views about the case and occasionally admitting to

some degree of liability, only to find these communications among

the other side’s exhibits after the discussions have fallen apart. The

remedy is simple: the best protection a party can have for settlement

discussions is channeling them through counsel. Even a non-

disclosure agreement (NDA) will not do. Here is why.

First, here is how using the counsel channel works. Let’s assume

that, in written or oral settlement communications, Counsel A

communicates the position of his client (Client A) to opposing


47


counsel, Counsel B. Client A’s position consists of admitting to some

liability in the dispute between Client A and Client B, and proposing

concessions. To report this to his client (Client B), Counsel B may

not forward Counsel A’s message: he must reformulate or

summarize it in his own words. As a result, all Client B will have in

hand is a message from Counsel B saying in substance “here is a

report on what Counsel A has told me.” If Client B fires Counsel B,

retains Counsel C and insists that Counsel C produce Counsel B’s

message to prove Client A’s admission, Counsel C should refuse to

produce this message. Even if Counsel C could be convinced to do

so; a message from Counsel B to Client B offered as a proof of an

admission of liability expressed by Client A would not be regarded as

convincing proof that Client A has actually admitted to some

liability.

Let’s assume now that Counsel B forwards to Client B a copy of

Counsel A’s settlement message (thereby committing an ethical

violation subject to rather stiff penalties), and that the client

subsequently convinces Counsel B or Counsel C to produce this

message in court to prove an admission of liability by Client A, as

reported by Client A’s own counsel. In this case, the law would

require the court to disregard this production and exclude it from the

record, based on the statutory principle that attorney-to-attorney

communications are per se confidential.

Against this background, why isn’t an NDA an appropriate

protection? Simply because the protection afforded by an NDA rests

on a much thinner basis than a communication between counsel. In

sum, for the party that discloses sensitive information, the NDA is

only as good as the other side’s faith in the sanctity of contract. If a

party decides to breach the NDA and produces information it has

received under it, there can be no certainty that the court would

reject the evidence so produced, and there would be no clear basis for


48


an ethical sanction on this party’s counsel. The party victim of the

breach could seek damages, to the extent that this party could prove

that the breach of the NDA has been the proximate cause of damage

it has suffered; however, this is very often impractical, because no

one can tell if there is any damage until the case has been finally

adjudicated. And even then, the facts generally do not lend

themselves easily to discerning a clear causal nexus between the

breach of the NDA and the ultimate outcome of the case for the

party victim of the breach.

On balance, because an NDA has no real teeth when it comes to

rejecting evidence produced in breach of the agreement, there is firm

and general belief that it is very unsafe to conduct settlement talks

without going through counsel, at least where the talks start

covering the hard issues of admissions, concessions and reciprocal

proposals.

So what is the narrow scope of the privilege, in the U.S. sense of this

term?

In practice, this privilege is confined to criminal and certain

administrative investigations, where investigators have search and

seizure powers. Here, a party subject to search and seizure may raise

a privilege to resist the seizure of documents that relate to work that

such party’s attorney has performed for this party.

There is no requirement that the work product be marked “attorney

work product” or any formal requirement of this nature. The

privilege applies to correspondence, meeting notes, and generally all

communication on whatever support; with the only exception of the

situation where the attorney himself would be suspected of having

committed a crime, and proof of this crime could be found in

communications with his client. If there is a disagreement between


49


investigators and a party regarding the seizure of documents that

could fall within the scope of the privilege, a judge must decide on

this issue (but this judge cannot be the one eventually deciding on

the case).

One final note: the confidentiality and privilege system outlined

above does not apply to in-house lawyers. In-house lawyer to in-

house lawyer communications, or communications between an in-

house counsel and a business person in the organization, have no

protection against production in court. In the context of criminal or

administrative investigations, no privilege can be raised in case an

investigator would want to seize an in-house lawyer memo on the

desk of a CEO, for instance.

. . .

An American lawyer may view this tour of French civil practice as a

mixture of “good news and bad news.” On the good side, the absence

of juries, the virtual absence of class actions, and modest damage

awards means that a litigation will generally have lower stakes or

risks; and the virtual absence of discovery results in far lower

litigation costs. The principal area that may cause an American

litigator to mourn the absence of U.S. procedures is when faced with

an “expertise” proceeding, which tends to follow unwritten rules and

procedures that may appear arcane.

But overall, American companies and lawyers should not be afraid of

French civil litigation: while the procedures are very different, they

work rather well.


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Documents

10 Things U.S. Litigators Should Know About Court .../media/email/documents/... · 3. Clarify the Role of Your French Attorney in Fact-Finding – 13 4. Do Not Count on Motion Practice